CURRENCY POLICY

Jonathan E Leightner

Chapter 6 in The Limits of Fiscal, Monetary, and Trade Policies:International Comparisons and Solutions, 2014, pp 97-136 from World Scientific Publishing Co. Pte. Ltd.

Abstract: Ben Bernanke (2005) discussed how a “global saving glut” was the core cause of the US trade deficit. However, Bernanke did not expand his analysis to the core cause of the world's problem, as I am doing in this book. Nor was Bernanke the first one to identify global savings gluts. Mummery and Hobson (1889, see also Leightner, 2000) developed a theory of underconsumption, which the classical school of economics ridiculed by saying, “In opposition to these palpable absurdities it was triumphantly established by political economists that consumption never needs encouragement” (Mill, 1967, p. 263).The Great Depression and Great Recession have proved that the classical school's “dismissal by ridicule” is inappropriate…

Keywords: Crisis; Government Policy; Glut Of Savings; Surplus Of Savings; Consumption; Fiscal Policy; Monetary Policy; Trade Policy; Exchange Rate Policy; Income Distribution; Austerity; Speculative Bubbles; Internal Devaluation; Keynesian Multipliers; Quantitative Easing; Currency War; USA; UK; China; Japan; Russia; Brazil; Europe; Greece; Ireland; Italy; Portugal; Spain (search for similar items in EconPapers)
Date: 2014
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